Executive compensation, Harvard governance, bullying
The Outlook for Libraries
I read with great interest “Gutenberg 2.0” (May-June, page 36) about the paradigmatic transformation of Harvard’s library system. However, I don’t think the article sufficiently emphasized the importance of the physical presence of libraries and the critical need to maintain this presence. One of my fondest memories was having the opportunity to study in the different Harvard libraries. I can still recollect my varied experiences in the very social environment of Lamont, the geeky science world of Cabot, the sleek, modern quiet of Loeb, and the homey feel of the Lowell House library. In all of these libraries, books were far more than simply information storage devices--they set the tone for the physical environment, and the accessibility of a number of well-placed books served to stimulate ideas and discussion. Insofar as the primary missions of a great university are education and cutting-edge scholarship, one of the most important aspects of libraries is providing a place for thinking to blossom. Sadly, I think this vision of the library as a sanctuary for scholarship is being eroded in the digital age. In fact, at the rate we’re going, I wonder if the library will eventually be reduced to a telephone-booth-sized information-retrieval kiosk with study and scholarship relegated to the nearby Starbucks (with tuition via latte).
Mark Gerstein ’89. Ph.D.
Williams professor of biomedical informatics,
molecular biophysics and biochemistry, and computer science Yale University
I will graduate from medical school this May, so I was surprised when I read that medical students chose text and memory over databases. Certainly, memory is the preferred way to impress an attending physician, but most medical students now carry an iPhone or other PDA with numerous medical resources. Anyone who has been on rounds can attest that while one student is searching his or her memory for the answer, other students are tapping their handheld devices. The problem lies not in the mindset of Googling, but in literally Googling. With such limited time, it is far too tempting to get an answer from Wikipedia rather than the Journal of the American Medical Association. Both resources are at our fingertips, but the former is much more succinct and usually correct, even though the latter is evidence-based and authoritative. Furthermore, as students rotate through different hospitals, access to online resources may change with regard to permission, content, and navigability. Yes, we’re searching online. We just need the speed of Google combined with weight of the New England Journal of Medicine.
Jeffrey Brown, D.P.S. ’05
Despite the quote from Professor Palfrey about the need to “make information as useful as possible to our community now and over a long period of time” (emphasis mine), providing remote access to the literature at present appears to be available only to Harvard students and faculty and others physically in a bricks-and-mortar library.
At least three groups of graduates suffer from the current restrictive access. The first is recent graduates who may not yet have secured employment that itself provides access, a serious issue in the current economic environment. Second is the mid-career person in an academic setting who may be denied tenure and be forced into adjunct status or even out of his chosen field for a few years. And third are those who have retired but wish to remain intellectually involved in their chosen field but cannot afford costs of $40 or more to obtain PDFs of single articles.
How can Harvard insure that its graduates maintain access to the literature? One solution would be to charge a nominal fee for access--something that appears available to Johns Hopkins graduates for $40 annually. Another might be to provide access to graduates who are members of their Harvard Club. Still another would be to offer access as a premium to those giving more than a specified amount each year.
If Harvard really wants to provide an opportunity for its graduates to remain intellectually involved throughout their lives, a solution to this problem should not be too difficult to implement.
David E. Levy ’63, M.D. ’68
New York City
The caption at the top of page 38 reads, “The book, or codex, took hundreds of years to replace handwritten manuscripts….” It’s not quite right. What’s meant by “codex” here is the printed book. But “codex” is just a form of book--blank ledger, printed book, picture album. Its opposite is the scroll (blank or written on), which was the normal medium for book production in classical antiquity.
Also, the idea that printed books took hundreds of years to win out is an exaggeration. Yes, it took several centuries for the printed book to completely drive out manuscripts, but the immediate success of the printed book in replacing manuscripts is not in doubt.
Walter Goffart ’55, Ph.D. ’61
Editor’s note: Sylvester Sterioff ’59, M.D., of the Mayo Clinic, Rochester, Minnesota, writes that in the last paragraph of the sidebar on page 82, Isaac Kohane must be referring to professor of surgery emeritus Joseph Murray, M.D. ’46, who received the 1990 Nobel Prize in physiology or medicine for the first successful living-related-donor kidney transplant. The first successful cadaveric (“deceased donor”) kidney transplant is attributed to David M. Hume ’40, later an instructor in surgery at Harvard Medical School, who worked closely with Murray and died in 1973.
Excessive Executive Pay
It is most remarkable that in the comprehensive analysis of executive compensation (“The Pay Problem,” May-June, page 30), the word “greed” is nowhere to be found. I learned long ago in medical school that unless you make the right diagnosis, you end up treating symptoms, but the disease progresses.
Jacob S. Walfish, M.D.’74
New York City
Jay Lorsch and Rakesh Khurana deserve great praise for their integrity, insights, and even bravery in writing “The Pay Problem.”
That two Harvard Business School professors have the temerity to directly challenge executive pay at publicly traded U.S. companies is itself notable. Their observation that corporations are now viewed as merely economic and financial institutions (i.e., “private”) without responsibility for moral and political consequences (which public stock should demand) exposes the absurdity of changes to our nation’s laws that treat these same institutions as virtual individuals. These laws have succeeded in transferring individual managerial responsibility to a collective corporate entity that is typically “punished” for illegal, unethical, or patently immoral behavior by paying fines that fall on the shoulders of shareholders. In extreme cases, shareholders may even see their equity reduced to nothing while managers collect their golden parachutes, landing safely at yet another company.
I hope this article starts much more serious reflection on not only the currently inappropriate approach to U.S. executive pay but also the body of law and process that supports this.
Mark Ludwig, M.B.A. ’69
I harbor no particular soft spot for large corporate compensation schemes, yet my patience was tried by “The Pay Problem.” Corporate executives are paid “too much” for work the authors consider at odds with our “collective destiny.” What irritates me about the tone of this essentially vacuous piece is that it won’t even openly suggest the implicit solution to the problem: wage controls. If, as the article suggests, higher than “fair” compensation packages are at the root of many of our social, economic, and environmental problems, then why not have the courage to advocate for regulated salaries? Wage and price controls have such an untarnished reputation that I’m surprised the authors do not lobby for them more strongly. Honestly, history’s brightest examples of “social and economic justice” are found within those regimes that promote centralized resource allocation and equal pay, and omnipotently take from those with ability to give to those with needs. Right? Perhaps the authors would do well to actually run a business instead of teaching it.
Paul Schwennesen, M.L.A. ’07
Lorsch and Khurana are themselves part of the business culture. The basic assumptions of that culture narrow their ability to propose creative solutions to the problem of executive pay. While they allude to the fallacy of the “great manager” explanation for great performance by a corporation, their business orientation keeps them from proposing the logical solution to this problem: When a company excels, if the CEO is to receive an obscene performance bonus, then a bonus should be given to all the employees of the corporation. Indeed the cash consequence of this democratic reward would likely constrain obscene bonuses. They also fail to mention the major inconsistency in incentive bonuses: they are only positive. If incentive bonuses are permitted, balance and logic should be preserved. If performance relative to the relevant economic sector as a whole is abysmal then the “incentive” should be negative--a prearranged cut in pay or payback of previously distributed options. One could, for instance, have all incentives, say for a five- or 10-year period, placed in a pot from which deductions are made for poor performance.
Neal F. Devitt ’77, M.D.
I would suggest that the relative improvement of government workers’ salaries (and workforce percentage) vis-à-vis those of the private sector dwarf the increase in executive pay in terms of size and societal impact and are therefore far more worthy of study than executive pay, although probably outside the curriculum of a business school.
Sidney Weber ’62
For all the problems with over-compensation of CEOs, at least there is a discussion of the issue due in large part to partial transparency that is required of publicly held corporations. A more disconcerting situation is the inflation in salary in the “not-for-profit” private university, where there has been an equally serious, but less transparent, inflation in the salary of many of the presidents and administrators. As a result of the corporatization of academic medical schools, a particularly significant distortion has occurred with salary increases that routinely exceed two to three times inflation for administrators, deans, and department heads, while the overall faculty and personnel salaries barely approach or even trail inflation. As in business, the success of the enterprise is a function of the many individuals on the frontlines and yet the rewards, as in business, flow to the top. Lorsch and Khurana should now take an equally serious and systematic look within our nontransparent academic walls.
Philip L. Smith II ’67, M.D.
Professor of Medicine, Johns Hopkins
“The Pay Problem” omits to mention the best explanation for CEO compensation: the “tournament theory,” developed at the University of Chicago when I was a graduate student there in the 1980s.
The metaphor is a tennis tournament: the financial reward for the winner is double that for the runner-up, and so on down the bracket. The winner may be only slightly better than other competitors, but the top-heavy prize money motivates the entire field. This point answers the article’s chief complaint that CEOs are highly paid even though “the joint efforts of many individuals cause the results achieved.”
The article ends with a manifesto for “a holistic re-examination…[of] the economic system we have created.” The tournament theory offers a more focused approach, and it disposes of the article’s obnoxious slur that “we don’t have to bribe executives to do the duties we have entrusted to them.”
Bruce Herzfelder ’81
I was very impressed with the thoughtful and detailed review of Harvard governance in view of the recent history of endowment and land development fiascoes (“Self Improvement,” May-June, page 55). I agree that Harvard’s levels of transparency and disclosure should be brought at least to the standards cited at Duke, Yale, and Stanford.
However, more radical restructuring of the governing bodies is needed for Harvard to survive and flourish in the future. I feel the Corporation should be tripled in size, to 21 members, two-thirds of whom should be directly elected by alumni. Given the importance of the governance issues, I am very surprised that all the current candidates for Overseers and Harvard Alumni Association directors are officially nominated ones. How can it be that with over 350,000 alumni, there is not a more organized independent governance reform movement? Last year civil rights attorney Harvey Silverglate and a few other independent candidates ran for Overseer, but they were hampered by Harvard’s refusal to give them access to official alumni mailing tools. And I have been further surprised to learn that Harvard has its own Hatch Act, barring Harvard faculty and certain other employees from running or even voting in the Overseer elections. Thus, many independent reform-minded candidates are barred from participating, and as a result reform from within cannot be expected to succeed.
The present governance by the small, aloof, isolated, and self-perpetuating Corporation cannot be defended as adequate to the tasks of ruling Harvard today. No institution, public or private, in business, the arts or education, of this size and importance, has such a similarly narrow and isolated ruling body, and one completely lacking any meaningful procedures of accountability and transparency. Even the beleaguered Catholic Church has a more “democratic” power center--the Pope is elected by about 100 cardinals.
Jerome Garchik, J.D. ’71
Editor’s note: No candidate for Overseer or HAA, whether nominated by official committee or by petition, receives access to University mailing or e-mail lists.
An ever-present task of the Corporation is to consider how it might more effectively support the University’s mission “to create knowledge, to open the minds of students to that knowledge, and to enable students to take best advantage of their educational opportunities.” Many of us on the faculty consider the last phrase as embracing the idea of preparing students to make important contributions to whatever intellectual, social, and professional communities they choose to join. In light of the worrisome state of U.S. capitalism and democracy today, we believe the Corporation should review its reluctance to direct attention to significant societal issues of our times.
Capitalism and democracy are our most fundamental systems of economic and political governance. Although U.S. capitalism has delivered high levels of average incomes and important economic and personal freedoms, this intricate system of economic governance is now afflicted by increasingly unequal distribution of personal incomes, continuing shortages of attractive employment opportunities, a serious decline in the much-vaunted upward mobility of American labor, and ethical drift. U.S. democracy has its own set of governance issues. The participation and influence of average, middle-class citizens in national political life has been diminished as powerful interest groups have become increasingly active in financing elections, lobbying Congress, and “purchasing public policy.”
We find it surprising and even alarming that, with the exception of the history department, there is little systematic attention paid within the University to the current status of American capitalism and democracy. This “gap” implies a failure to fulfill our mission of educating effective and responsible participants in our nation’s life. If the Corporation finds such a gap, it should investigate the causes.
Could it be that junior faculty in the social sciences are hired, mentored, evaluated, and promoted according to standards biased towards quantitative analyses of narrowly specified problems? Or could it be an increasing de-emphasis of historical analysis that illuminates how U.S. society got to be where it is now?
We believe the Harvard Corporation has an important role to play in encouraging its various faculties to draw upon historical method, sociology, and political science, as well as economics, to educate students to understand the context and full consequences of choices they face regarding the future of U.S. capitalism and democracy and in ensuring that our graduates are capable, in Lincoln’s words, of influencing and leading institutions of all kinds that are for the people and not just by the people.
Cherington professor of business administration emeritus
Malcolm S. Salter
Hill professor of business administration emeritus
Harvard Business School
Masauko Chipembere, Honored
Many thanks to Robert Rotberg for the Vita on Masauko Chipembere (May-June, page 42). After completing my undergraduate coursework in 1963, I joined the Peace Corps and was sent to (then) Nyasaland, where I taught at an excellent secondary school in the (then) capital of Zomba. Those were exciting times: we young volunteers were privileged informally to meet members of the emerging Malawi government, including Chipembere and his colleague Yatuta Chisiza. We grieved when Banda seized autocratic powers during the “Cabinet Crisis” of 1964 and forced our friends out. I’m glad that Chipembere (which is the Chichewa word for “rhinoceros,” a formidable animal!) is now honored.
Parker Swanson ’62
Bloodied Noses and Bullying
In a letter published in the May-June issue (page 2), Jeffrey Antman expresses dismay at the phenomenon of “helicopter parents” who organize their children’s busy lives, even in college. Referring nostalgically to his own youth, he writes that parents “knew that adventuring was all part of what was called ‘growing up,’ just like boys having fights, learning how to deal with bullies, and coming home with bloody noses.”
It’s unfortunate that he perpetuates the survival-of-the-fittest attitude that has long justified adults’ inclination to look the other way when bullying and peer abuse are happening. I endured years of bullying while the adults around me waited for me to “grow up”--by stooping to the bullies’ level and bloodying (or at least attempting to bloody) some noses. I never did.
Antman may judge boys like me to be stupid or cowardly. For my part, though, I’m pleased to see the anti-bullying policies and programs that are increasingly being put into place by forward-thinking schools. Happily, many teachers and parents have now come to understand that it’s unkind and unconstructive to leave our children to spend much of their lives in a state of nature in which the strong prey cruelly on the weak.
Jay Gabler, Ed.M. ’98, Ph.D. ’07
Corrections and Clarifications
The College Pump (May-June 2010, page 72) shows a “Pennies for Harvard” barrel owned by an alum in “Sarasota Springs, New York.” Surely you meant Saratoga Springs.
Gerald M. Erchak, Ph.D. ’76
Saratoga Springs, N.Y.
In the article about reunioners showcasing their creativity (“In the Limelight,” Commencement & Reunion Guide, May-June, page 16A), the joke from the sketch “Bitter Spouses” was misquoted. The bitter spouse said, “I don’t know why I had to fly all across the country to see where Elsie’s [not “where else he”] used to be.” The line quoted doesn’t make sense. But I guess if you are too young to remember Elsie’s, the actual line doesn’t make sense, either. I sure miss the “Turkey Deluxe” sandwich.
Tom Gammill ’79
Editor’s note: Tom Gammill wrote the script for the show, so he should know. The quote was picked up from watching a DVD of the show--and fact-checked with the producer, who apparently did not catch that reference to Elsie’s, either.
Speak Up, Please
Harvard Magazine welcomes letters on its contents. Please write to “Letters,” Harvard Magazine, 7 Ware Street, Cambridge 02138, send comments by e-mail to [email protected], or fax us at 617-495-0324. Letters may be edited to fit the available space.
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